Northwest Natural Gas (NWN)
NYSE:NWN
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Northwest Gas
(NYSE:NWN)
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Rating:52Neutral
Price Target:
$51.00
▼(-5.63% Downside)
Action:Reiterated
Date:05/09/26
The score is held back primarily by weak cash flow quality (persistently negative free cash flow) and elevated leverage, alongside soft near-term technical momentum. Offsetting these are constructive earnings-call fundamentals (reaffirmed guidance, strong C Energy growth, and regulatory progress) and an attractive ~3.9% dividend yield.
Positive Factors
Regulatory wins support rate base
A multiyear Washington settlement that adds near-term revenue and a 9.5% allowed ROE materially strengthens the utility’s authorized cash return profile. This supports sustainable rate-base recoveries, steadier regulated earnings and reduces exposure to short-term commodity cycles over coming years.
Negative Factors
Persistent negative free cash flow
Repeated negative free cash flow and weak cash conversion (OCF covering a minority of net income) indicate structural funding pressure. Sustained negative FCF forces continual external financing for capex and dividends, raising refinancing and cost-of-capital risks over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Regulatory wins support rate base
A multiyear Washington settlement that adds near-term revenue and a 9.5% allowed ROE materially strengthens the utility’s authorized cash return profile. This supports sustainable rate-base recoveries, steadier regulated earnings and reduces exposure to short-term commodity cycles over coming years.
Read all positive factors
Northwest Gas Key Performance Indicators (KPIs)
Any
Operating Income by Segment
Shows profitability across different business areas, highlighting which segments drive earnings and where there might be challenges or opportunities.
Shows profitability across different business areas, highlighting which segments drive earnings and where there might be challenges or opportunities.
Data provided by:
The Fly
The FlyNorthwest Gas (NWN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.10B
Dividend Yield4.18%
Average Volume (3M)233.42K
Price to Earnings (P/E)5.6
Beta (1Y)0.18
Revenue Growth5.90%
EPS Growth16.54%
CountryUS
Employees1,452
SectorUtilities
Sector Strength65
IndustryRegulated Gas
Share Statistics
EPS (TTM)2.99
Shares Outstanding42,080,353
10 Day Avg. Volume311,250
30 Day Avg. Volume233,419
Financial Highlights & Ratios
PEG Ratio0.46
Price to Book (P/B)1.29
Price to Sales (P/S)1.48
P/FCF Ratio-9.66
Enterprise Value/Market Cap2.26
Enterprise Value/Revenue3.69
Enterprise Value/Gross Profit8.74
Enterprise Value/Ebitda8.79
Forecast
1Y Price Target
$56.80Price Target Upside5.11% Upside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)3.06
Revenue Forecast (FY)$1.40B
Northwest Gas Business Overview & Revenue Model
Company Description
Northwest Natural Holding Company, through its subsidiary, Northwest Natural Gas Company, provides regulated natural gas distribution services to residential, commercial, industrial, and transportation customers in Oregon and Southwest Washington....
How the Company Makes Money
NWN primarily makes money through its regulated natural gas utility operations. Revenue is generated by delivering natural gas to end customers and billing them under rates (tariffs) approved by state utility regulators. Customer bills generally i...
Northwest Gas Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Positive
The call portrayed a predominantly positive operational and financial tone: strong customer growth at C Energy, progress on multiple regulatory fronts (Washington settlement, Texas filing), MX3 development upside, reaffirmed guidance, and a balanced funding plan underpin confidence. Headwinds are largely timing- and investment-related—higher depreciation and financing needs, regulatory timing uncertainty (particularly in Oregon), and seasonal/near-term margin pressure in water. On balance the highlights (growth metrics, regulatory wins, MX3 optionality, liquidity) outweigh the lowlights (timing, near-term costs), supporting constructive confidence in the company’s outlook.Positive Updates
Reaffirmed 2026 Guidance and Solid Start
Company reaffirmed full-year 2026 EPS guidance of $2.95 to $3.15 and reported adjusted EPS of $2.33 in Q1 2026, up $0.05 (+2.2%) versus $2.28 in prior-year period, with adjusted net income up $5.7 million.
Negative Updates
Regulatory Timing and Uncertainty in Oregon
Multiyear rate case rulemaking in Oregon could slip into 2027, creating uncertainty around the timing of rate relief; Fair Act constraints and regulatory cadence may cause rate base growth to outpace recognized earnings, producing potential 'catch-up' risk later in the planning horizon.
Read all updates
Q1-2026 Updates
Positive
Negative
Reaffirmed 2026 Guidance and Solid Start
Company reaffirmed full-year 2026 EPS guidance of $2.95 to $3.15 and reported adjusted EPS of $2.33 in Q1 2026, up $0.05 (+2.2%) versus $2.28 in prior-year period, with adjusted net income up $5.7 million.
Read all positive updates
Company Guidance
Management reaffirmed full‑year 2026 EPS guidance of $2.95–$3.15 and maintained long‑term EPS growth guidance of 4%–6% (expected to increase to 5%–7% upon MX3 notice to proceed); Q1 adjusted EPS was $2.33 (vs. $2.28), adjusted net income rose $5.7M and EPS was +$0.05 for the quarter. They expect 2026 capex of $500M–$550M funded by ~ $150M net long‑term debt and $40M–$50M equity from the ATM, with ≈$590M liquidity; C Energy delivered 16% organic customer growth, >250k meter backlog, expects 15%–20% annual customer growth through 2030 and to contribute ~10%–15% of consolidated EPS, is seeking a $12M revenue increase with a 10.75% ROE (cost of capital 8.73%, rate base up $176.9M to $343.1M); Northwest Natural Water grew customers 4.1% (2.2% organic), has >10k connection backlog (≈25% under development), expects 2%–3% organic growth through 2030 and to contribute ~10%–15% of EPS; combined C Energy and Water are expected to drive ~25% of consolidated EPS in 2026. Additional regulatory metrics include a Washington settlement adding $20.1M (yr1), $7.7M (yr2), $8.7M (yr3) starting 8/1/2026 with a 50/50 capital structure and 9.5% ROE, an Oregon ARM contemplating a 1.5% rate increase 10/31/2026, and the MX3 storage project ($300M, 4–5 Bcf, 25‑yr contracts) targeting NTP by 2027 and in‑service in 2029 (not yet included in current guidance).Northwest Gas Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
52
Neutral
Cash Flow
34
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.29B | 1.29B | 1.15B | 1.20B | 1.04B | 860.40M |
| Gross Profit | 543.21M | 510.06M | 397.61M | 423.87M | 341.23M | 329.12M |
| EBITDA | 540.07M | 470.56M | 348.09M | 344.49M | 303.37M | 264.09M |
| Net Income | 122.89M | 113.32M | 78.87M | 93.87M | 86.30M | 78.67M |
Balance Sheet | ||||||
| Total Assets | 6.42B | 6.24B | 5.23B | 4.87B | 4.75B | 4.06B |
| Cash, Cash Equivalents and Short-Term Investments | 37.66M | 41.08M | 38.49M | 32.92M | 29.27M | 18.56M |
| Total Debt | 2.68B | 2.76B | 1.96B | 1.75B | 1.68B | 1.52B |
| Total Liabilities | 4.84B | 4.76B | 3.85B | 3.58B | 3.57B | 3.13B |
| Stockholders Equity | 1.58B | 1.48B | 1.39B | 1.28B | 1.18B | 935.15M |
Cash Flow | ||||||
| Free Cash Flow | -272.72M | -197.77M | -194.12M | -47.40M | -190.93M | -133.54M |
| Operating Cash Flow | 205.64M | 269.12M | 200.28M | 279.95M | 147.67M | 160.35M |
| Investing Cash Flow | -549.98M | -808.90M | -428.99M | -335.50M | -435.46M | -300.12M |
| Financing Cash Flow | 277.73M | 532.87M | 227.06M | 64.21M | 301.63M | 131.44M |
Northwest Gas Technical Analysis
Neutral
54.04
Price Trends
52.21
Negative
49.99
Negative
46.74
Positive
Market Momentum
-0.83
Positive
42.56
Neutral
47.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NWN, the sentiment is Neutral. The current price of 54.04 is above the 20-day moving average (MA) of 51.17, above the 50-day MA of 52.21, and above the 200-day MA of 46.74, indicating a neutral trend. The MACD of -0.83 indicates Positive momentum. The RSI at 42.56 is Neutral, neither overbought nor oversold. The STOCH value of 47.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NWN.
Northwest Gas Risk Analysis
Northwest Gas disclosed 35 risk factors in its most recent earnings report. Northwest Gas reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Northwest Gas Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $3.05B | 12.75 | 9.49% | 2.15% | 17.14% | 15.65% | |
66 Neutral | $6.49B | 11.37 | 11.86% | 3.07% | -48.15% | 105.44% | |
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
65 Neutral | $5.20B | 10.53 | 8.20% | 3.45% | 2.81% | 7.01% | |
64 Neutral | $2.98B | -73.53 | 4.27% | ― | 18.67% | 3110.38% | |
62 Neutral | $5.13B | 4.73 | 10.45% | 3.82% | 4.53% | 40.51% | |
52 Neutral | $2.10B | 5.58 | 8.27% | 4.18% | 5.90% | 16.54% |
* Utilities Sector Average
NWN
Northwest Gas
49.92
10.68
27.22%
CPK
Chesapeake Utilities
126.95
7.29
6.09%
SR
Spire
86.71
15.39
21.58%
SWX
Southwest Gas
89.66
22.63
33.76%
OGS
ONE Gas
82.80
10.47
14.47%
CTRI
Centuri Holdings, Inc.
29.51
11.12
60.47%
Northwest Gas Corporate Events
Business Operations and StrategyRegulatory Filings and Compliance
Northwest Gas Reaches Washington Rate Case Settlement Agreement
Positive
Mar 24, 2026
On March 23, 2026, Northwest Natural Gas Company and most parties to its Washington general rate case filed a settlement with the Washington Utilities and Transportation Commission that would set smaller phased-in rate increases than originally re...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.